public sector infrastructure in south africa presentation to roads pavement forum 10 may 2006

Public Sector Infrastructurein South Africa

Presentation to

Roads Pavement Forum

10 May 2006

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Introduction: SA infrastructure

• Extensive network of 752000 km of national, provincial,municipal and access roads and 19700 km of rail, together moving about 700 million tons a year domestically,

• 7 of 16 Southern African major commercial ports - handling 161 million tons annually.

• 3 major international airports and 7 regional airports handling 500 000 flights, 21 million passengers and 0,5 million tons of freight a year.

• About 250 large dams with a capacity of 30 billion cubic metres• 478 passenger railway stations, and 2,2 million passenger trips/

day • 29 400 schools accommodating about 12,3 million learners• Electricity generation capacity of over 40 000 MW continuous power• 156 million circuit kilometers of telephone line with 5,5 million

installed phones• 3000 km of petroleum and gas pipelines.

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Why focus on infrastructure?Although SA is relatively well endowed with a relatively good infrastructure stock in many sectors, there are wide disparities and growing demands, and so we still face many challenges:Apartheid legacy of unequal infrastructure distribution (backlogs)

– Infrastructure in townships - lacking, of poor quality and in general disrepair – roads, pavements, streetlighting, clinics, schools, etc

– Lack access to water, electricity and communications infrastructure– Housing provision did not meet demand…could not own land in urban

areas

New Demand– With democratic change and economic growth came changes in social and

economic patterns – increasing urbanisation etc, placing pressures on various infrastructure sectors, resulting in higher infrastructure demands, and increased maintenance and rehabilitation needs

– Increased pressure on economic infrastructure eg. ports, increased traffic at border posts and urban and provincial roads, aging railway rolling stock, lines and signalling, airplanes etc.

– Increased pressure on social infrastructure – schools, health infrastructure, justice, safety and security infrastructure, government facilities etc

Spatial Inequalities– Urban-rural divide, migration and social movement, densities and

economies of scale

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Broad economic impacts of infrastructure

• Expenditure on infrastructure and the built environment are regarded as ‘investments’, which imply welfare benefits to individuals and groups in society and ‘returns’ to the economy as a whole in the form of multipliers of economic growth.

• Being durable in nature, the capital investments have an inter-temporal effect

in that the savings of the present generation are harnessed for the benefit of present and future generations as well. For the present generation the additional benefits, besides utility and future returns, are the immediate jobs created in the building of infrastructure, and so there is a direct poverty reduction/ pro-poor element to infrastructure investment.

• The roads, pipelines, cables, transmitters etc, facilitate the access of inputs

into our factories and production facilities, which produce goods and services, and facilitate the access to goods and services, distribution facilities, product and societal information dissemination, etc. In short, it has been written that investments in infrastructure support development by:

– Creating favourable conditions for production and consumption– Facilitating economic diversification– Providing access for people to both government and private sector

services and opportunities

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Infrastructure delivery in the 10 years of democracy

• 1,6 million subsidised houses constructed.• 56000 classrooms constructed, 2700 schools connected to water, 4000 to

electricity.• 700 new clinics constructed, 2300 clinics re-equipped. 141 hospitals

rehabilitated and 3 new tertiary hospitals constructed (2000 beds added) • Water supply to 9 million more people and sanitation to 6,4 million more. 6

more dams constructed including the Lesotho Highland project.• Over 4 million more electricity connections.• 3000 projects building or improving police stations• Prison expansion to accommodate 15000 more prisoners• Renovation and extension of 129 court buildings• Construction, rehabilitation and maintenance of 6000km of national roads and

15000km of provincial roads.• About R10 billion private sector investment in toll road PPP’s.• Remodelling and refurbishment of 150 main commuter rail stations and 7 new

stations, with 264 engines and coaches rebuilt.• R38 billion spent by Transnet on freight rolling stock, port upgrades and

aircraft purchases.

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Infrastructure Institutional Arrangements

National departments: 22 of 34 national departments perform infrastructure functions such as government buildings, bulk water resources, police stations, courts and prisons, electrification etc, as well as make infrastructure transfers to agencies and public entities.

Provincial departments: mainly schools, health infrastructure, agricultural infrastructure, provincial roads and public works. Infrastructure budgets derived from own revenues, provincial equitable share, as well as infrastructure grants allocated by NT and national departments.

Local government: municipal roads and stormwater, water distribution and wastewater collection and treatment, electricity distribution, streetlighting, bus and taxi ranks, community halls, refuse sites etc. Budgets derived from own revenue and supported by Municipal infrastructure grant from national

Large number of extra budgetary institutions/agencies and public entities that are publicly owned but operate on business principles and deliver infrastructure eg. 17 water boards, SA Roads Agency, TCTA, SARCC, Transnet, Eskom, Telkom, Sentech etc. Funding is obtained from user charge retained earnings, borrowing, transfers from oversight government departments, ppp’s and concessioning, sale of assets etc.

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Infrastructure Budgeting & Reporting

• Independent budgeting by different spheres of government and entities based on their needs and priorities however, reporting to NT is a requirement.

• National department infrastructure budgeting is integrated within the main budgeting process – 3 year MTEF

• Requirements specific to infrastructure are published in the Treasury guidelines to departments annually and departments present motivations at MTEC hearings – ensures capex alignment with operational capability and budget, feasibility etc.

• National policy departments make requests/representations on behalf of agencies and spheres that they fund.

• Reporting on infrastructure is currently done per dept in the Estimates of National Expenditure (ENE). Currently only ‘mega’ and large projects are reported individually with small projects aggregated. Also reported are transfers to agencies and other spheres, transfers to households, and maintenance.

• NT also publishes aggregate public sector estimates in the Budget Review.

• National and Provincial Infrastructure Project Registers – requires individual project detail and tracks project delivery quarterly.

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Budgeting Framework(source: Afrec)

Constitutional, Political, Legislative and Macroeconomic environment

PLANNING

BUDGETING MONITORING &EVALUATION

IMPLEMENTATION

POLICYPRIORITYINPUTS

RESOURCEINPUTS

SERVICEDELIVERYOUTPUTS Out-

comes

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Broad Treasury capital budgeting role

MONITORING AND EVALUATION ROLE

-spending and output performance feedback-evaluation wrt efficiency, economy, effectiveness-Infrastructure Project Registers – delivery and expenditure

POLICY, PLANNING AND DECISION SUPPORT ROLE

-strategic ‘big picture’ on infrastructure delivery & sectoral profiles,GDP multipliers etc, and better targeting of infrastructure portfolio-Development of appraisal guidelines suited to SA, and refinement of decision processes, capacity building in departments for appraisal-buy/lease, dispose/maintain/reinvest trade-offs and decisions-backlogs/demand assessment, macro GFCF targets

RESOURCE INPUT/ BUDGETING ROLE

-strategic level – are we making the right capital decisions as a country-portfolio level – do we have the correct mix and spread of projects in any one year, given capital constraints etc-project level – appraisal – benefit to cost-institutional/industry issues- delivery/spending capacity etc

COORDINATION, COLLABORATION, INTERVENTION ROLE-potential proactive role in delivery, stakeholders, implementers, research etc.

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Capital Budgets Committee

ROLE

• Initiated within the 2005 MTEC process

• MTEC sub-committee - Interdepartmental in nature, Treasury lead

• Act as a filter to the main budget process

• Undertake the review of individual capital/infrastructure project and programme bids made by departments to Treasury for funding

• Prioritisation and Selection of projects -capital rationing situation

• Make recommendations to MTEC, Mincombud

• Further role; develop and improve appraisal process in future

COMPOSITION

• Major infrastructure ‘oversight’ departments, and the ‘development’ and grant distribution departments + the Presidency:

• Transport, DWAF, Housing, DPLG, Public Works, DTI, DME, Presidency, National Treasury (various sections)

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National and Provincial Infrastructure Project Registers

• Over 15000 projects valued at R111,7 billion currently on the National Project Register, 6 500 of which are currently under construction

• Over 10000 projects currently on the Provincial Project RegisterPROJECT REGISTER OBJECTIVES• Enable the departments as well as Treasury to give full account of progress made with

spending on a regular basis • Track infrastructure delivery progress with the utilisation of budgeted funds and

physical implementation of projects• Track spending on both capital and maintenance projects• Track project progress from project identification to completion• Support Treasury’s budget allocation process for infrastructure projects • Communicate progress and achievement to relevant stakeholders and the public

PROJECT REGISTER INFORMATION• Project information from department as well as entities submitted on quarterly basis• Financial Data – budget, cash flow and expenditure with expenditure measured against

budget and cash flow;• Non-Financial Data - project details, type of project, name, nature of investment,

location of the project etc.• Physical progress – quarterly progress measured (this include outputs achieved,

project stage etc.)• Data on Expanded Public Works Programme (in case where the project is labour

intensive)• Auditable information - payment certificate number, responsible official for the project

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Budget Review Infrastructure related estimates

2006 MTEF

2006 MTEF infrastructure related expenditure estimates2002/03 2003/04 2004/05 2005/06 2006/07 2007/08 2008/09

R million Revised estimate

Medium-term estimates

National departments 1,2 5,952 6,022 7,262 7,835 8,884 10,578 12,381 Provincial departments 2 15,491 19,642 21,586 24,412 31,989 36,201 40,669 Municipalities 13,100 16,687 17,053 24,759 26,046 27,296 28,524

Public private partnerships 3 849 1,552 1,106 1,594 3,776 4,776 3,672

Extra-budgetary public entities 2,854 3,053 3,470 3,650 4,116 4,521 4,927 Non-financial public enterprises 26,803 21,375 22,145 27,566 37,694 42,092 43,662 Total 65,049 68,331 72,622 89,816 112,505 125,464 133,835 percentage of GDP 5.4% 5.3% 5.1% 5.8% 6.6% 6.7% 6.4%GDP 1,198,344 1,281,438 1,419,991 1,559,580 1,714,528 1,884,866 2,095,911 1. Transfers between spheres have been netted out.2. Includes maintanance of infrastructure assets.3. Capital expenditure on PPPs overseen by the Treasury PPP Unit, S A National Roads Agency,

Department of Public Works, and at municipal level, with MIIU assistance.

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2006 ENE – departmental infrastructure summarySummary of Infrastructure for 2006 ENEVotes 2002/03 2003/04 2004/05 2005/06 2006/07 2007/08 2008/09 MTEF

Outcome Adjusted Totalappro-

R thousands priation CENTRAL GOVERNMENT ADMINISTRATION 2,127,468 2,710,188 4,875,446 6,027,702 7,179,510 8,332,614 9,336,584 24,848,708

3 Foreign Affairs 87,700 77,602 56,703 132,000 253,000 316,000 223,000 792,0004 Home Affairs 19,542 28,992 35,952 20,376 104,913 53,500 55,994 214,4075 Provinicial and Local Government 1,865,199 2,286,762 4,439,942 5,436,161 6,265,300 7,148,564 8,053,090 21,466,9546 Public Works 155,027 316,832 342,849 439,165 556,297 814,550 1,004,500 2,375,347

FINANCIAL AND ADMINISTRATIVE SERVICES 1,984,920 2,546,488 3,354,699 3,750,773 4,168,119 6,274,025 7,196,707 17,638,8518 National Treasury 1,984,920 2,546,488 3,354,699 3,750,773 4,168,119 6,274,025 7,196,707 17,638,851

SOCIAL SERVICES 261,751 642,169 1,124,574 1,263,304 1,585,292 1,783,360 2,252,786 5,621,43814 Arts and Culture 90,449 216,544 286,569 216,086 305,008 244,064 451,522 1,000,59415 Education 12,822 42,805 0 0 0 0 0 016 Health 158,480 382,820 838,005 1,047,218 1,280,284 1,539,296 1,801,264 4,620,844

JUSTICE AND PROTECTION SERVICES 1,344,927 1,195,879 1,672,800 1,945,016 1,984,170 2,542,635 3,275,841 7,802,64620 Correctional Services 676,213 493,371 879,805 982,950 1,007,570 1,057,886 1,137,227 3,202,68321 Defence 140,736 130,012 154,143 197,522 210,281 482,633 644,472 1,337,38623 Justice and Constitutional Development 271,138 258,017 270,483 317,975 268,134 293,622 305,977 867,73324 Safety and Security 256,840 314,479 368,369 446,569 498,185 708,494 1,188,165 2,394,844

ECONOMIC SERVICES AND INFRASTRUCTURE 7,530,274 8,407,376 6,857,564 7,875,334 15,399,638 17,547,247 19,895,784 52,842,66925 Agriculture 33,115 36,614 40,088 60,736 47,970 48,183 50,107 146,26026 Communications 36,710 0 0 100,000 150,000 150,000 0 300,00027 Environmental Affairs and Tourism 237,000 269,326 237,364 158,002 169,776 325,556 395,090 890,42228 Housing 3,800,674 4,246,239 4,473,597 4,843,480 6,349,949 7,937,946 8,721,382 23,009,27729 Land Affairs 2,745 8,391 2,624 8,461 9,129 9,524 10,162 28,81530 Minerals and Energy 225,000 245,000 251,000 313,000 1,368,000 1,423,000 1,600,000 4,391,00031 Science and Technology 0 0 0 0 243,000 265,000 385,000 893,00032 Trade and Industry 58,200 164,482 93,043 268,640 491,942 701,540 911,361 2,104,84333 Transport 1,112,072 1,129,694 1,159,276 1,495,343 5,767,550 5,746,428 6,834,627 18,348,60534 Water Affairs and Forestry 2,024,758 2,307,630 600,572 627,672 802,322 940,070 988,055 2,730,447

TOTAL 13,249,340 15,502,100 17,885,083 20,862,129 30,316,729 36,479,881 41,957,702 108,754,312

Medium-term expenditure estimate

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Provincial Government Capex-2006 MTEF

Provincial Payments for Capital Assets over the MTEF, 2002/03 to 2007/08

AcualsProjected outcome

Medium-term estimates

2002/03 2003/04 2004/05 2005/06 2006/07 2007/08 2008/09

4.66% 5.07% 4.76% 4.48%104.7 110.0 115.2 120.4Eastern Cape 839,702 1,699,210 2,069,253 1,629,003 2,242,729 2,741,107 3,490,467

Education 123,955 114,574 316,339 353,620 761,746 924,025 1,513,506

Health 105,735 525,666 367,443 491,245 568,898 661,404 697,426

Public Works, Roads and Transport 558,696 896,981 1,345,217 660,297 764,433 1,014,877 1,091,114

Other 51,316 161,989 40,254 123,841 147,652 140,801 188,422

Free State 454,602 520,958 531,454 636,744 588,256 995,475 1,302,003

Education 124,604 150,194 109,879 85,386 54,430 56,482 58,499

Health 35,688 139,154 176,798 212,308 162,950 162,360 175,615

Public Works, Roads and Transport 252,241 156,011 169,171 215,499 272,988 671,359 958,368

Other 42,069 75,599 75,606 123,551 97,888 105,274 109,521

Gauteng 1,671,103 1,196,480 1,885,380 2,082,289 2,496,627 2,602,459 3,117,769

Education 323,332 551,643 685,088 585,590 725,679 733,350 844,936

Health 470,285 488,587 367,998 847,096 925,198 905,572 1,172,571


Other 227,562 109,498 105,566 242,424 277,699 282,481 179,629

KwaZulu-Natal 1,846,299 2,318,646 2,360,157 3,602,512 3,615,902 4,193,426 4,667,734

Education 390,427 563,499 485,145 886,433 893,428 966,717 997,179

Health 459,002 512,201 587,492 1,031,952 1,039,618 1,181,617 1,393,945

Public Works, Roads and Transport 793,335 1,090,469 1,135,909 1,422,235 1,477,459 1,821,864 2,053,393

Other 203,535 152,477 151,611 261,892 205,397 223,228 223,217

Limpopo 649,577 897,303 1,313,269 1,590,317 1,599,202 1,720,792 1,872,588

Education 207,409 326,456 457,672 491,845 437,008 442,583 467,725

Health 288,252 319,219 395,408 503,483 541,775 625,383 657,199


Other 102,281 169,941 363,394 415,185 485,937 521,584 600,421

Mpumalanga 634,423 617,458 758,619 1,139,477 1,092,694 1,432,016 1,415,764

Education 118,882 236,556 135,062 252,974 277,539 358,406 366,022

Health 124,818 54,887 183,443 265,398 204,443 251,501 266,485


Other 39,233 67,795 69,778 167,977 215,744 164,588 182,607

Northern Cape 250,061 200,295 220,504 296,801 482,699 591,088 497,263

Education 19,553 44,488 16,889 28,824 42,452 40,925 42,190

Health 35,944 42,387 83,729 110,080 267,691 300,912 201,737


Other 44,109 20,093 18,525 48,034 37,340 49,441 52,469

North West 590,993 608,952 610,945 1,215,488 1,119,398 1,402,745 1,702,343

Education 135,613 139,684 142,598 269,886 205,025 244,624 426,114

Health 197,656 127,251 192,719 207,090 259,140 323,379 368,285


Other 78,173 76,404 70,615 216,215 237,634 335,420 306,399

Western Cape 823,487 942,135 1,059,599 1,541,818 1,662,689 1,667,601 1,798,207

Education 104,005 138,090 151,533 335,703 237,437 192,257 181,339

Health 119,347 217,010 327,853 352,748 383,461 411,992 399,292

Public Works, Roads and Transport 445,305 488,189 484,786 753,560 987,623 993,438 1,143,458

Other 154,830 98,846 95,427 99,807 54,168 69,914 74,118

Summary 7,760,248 9,001,437 10,809,180 13,734,449 14,900,196 17,346,709 19,864,138

Education 1,547,780 2,265,184 2,500,205 3,290,261 3,634,744 3,959,369 4,897,510

Health 1,836,727 2,426,362 2,682,883 4,021,400 4,353,174 4,824,120 5,332,555

Public Works, Roads and Transport 3,432,632 3,377,249 4,635,316 4,723,862 5,152,820 6,670,489 7,717,270

Other 943,109 932,642 990,776 1,698,926 1,759,459 1,892,731 1,916,803

TOTAL 7,760,248 9,001,437 10,809,180 13,734,449 14,900,196 17,346,709 19,864,138

Source: Provincial 2nd Draft 2006/07 Budget Statements Database.

R thousand

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Municipal Grants(Budget Review 2006)

National transfers to Local Government, 1998/99 – 2008/09

1998/99 1999/00 2000/01 2001/02 2002/03 2003/04 2004/05 2005/06 2006/07 2007/08 2008/09R million Medium Term estimatesCMIP 703 696 851 996 1 723 2 285 - - - - -Water Services Project 520 626 725 757 999 1 022 217 139 - - -Community Based Public Works 152 356 374 357 260 262 - - - - -Local Economic Development Fund - 10 78 87 143 117 - - - - -Sport and Recreation Facilities - - - 36 84 122 134 - - - -National Electrif ication Programme - - - - 225 245 251 313 1 368 1 423 1 600Urban Transport Fund - 30 22 38 40 9 - - - - -Municipal Infrastructure Grant - - - - - 41 4 481 5 436 6 265 7 149 8 053Public Transport Infrastructure & Systems Fund - - - - - - - 242 519 624 1 790Neighbourhood Development Partnership Grant - - - - - - - - 50 950 1 500Other - - 6 33 - - 280 311 - - -Total 1 375 1 718 2 056 2 304 3 474 4 103 5 363 6 441 8 203 10 145 12 943

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ESKOM Capex• 5 year plan revised to R98 bn, nominal.• Return to service of Camden (R1,5bn), Grootvlei (R3bn), Komati (R3,6bn) &

refurbishment of Kriel (R1,1bn)• OCGT plants in Atlantis and Mossel Bay, (R2bn) completion in 2007 & 2010

CCGT plants at Saldanha and Coega (R4bn)• Hydro pumped storage schemes – Braamhoek (R5bn) and Steelpoort (R1,5bn) • Partner on Inga hydro project (R1,6bn) in DRC • Transmission capacity strengthening (incl. Cape lines)

Eskom Holdings Capex

R million 2005/06 2006/07 2007/08 2008/09 2009/10 2010/11 5 yr plan

Generation 5 582 10 228 9 089 11 026 14 320 17 009 61 672

Transmission 1 093 1 630 2 876 3 143 3 271 1 653 12 573

Distribution 3 589 3 056 3 557 3 506 3 657 3 957 17 733

Corporate 437 405 348 354 349 348 1 804

Other - 35 57 364 1 282 2 678 4 416

Total funded by Eskom 10 701 15 354 15 927 18 393 22 879 25 645 98 198

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Transnet Capex• MTBPS estimates – Transnet revising its capital programme• All major projects have commenced• Capacity expansion on Orex and Coalink lines• Multi-purpose terminal at RB, Durban Pier 1 conversion for containers, Island

View reconstruction, Cape Town container expansion, port superstructure• Multi-products petroleum pipeline - coast to reef

Transnet capex (MTBPS 2005)

R million

2005/06 2006/07 2007/08 2008/09 MTEF

Spoornet 3 777 3 880 4 429 4 352 12 660

NPA 1 727 3 671 4 152 3 571 11 394

SAPO 1 116 1 573 1 020 697 3 290

Petronet - 132 161 1 338 1 631

Total core business 6 620 9 256 9 762 9 958 28 975

SAA 853 506 2 307 507 3 320

Other non core 692 180 134 134 448

Total Transnet 8 164 9 942 12 202 10 598 32 743

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Focus on key infrastructure sectors (table under construction – not a complete breakdown)

Capital/Infrastructure Expenditure Estimates in key sectorsSector 2002/03 2003/04 2004/05 2005/06 2006/07 2007/08 2008/09 MTEF

Water (DWAF, Water Boards, TCTA & Municipal) 4,966 5,038 4,531 6,039 7,422 6,176 5,706 19,304 Sanitation (Municipal & DWAF) 782 1,565 1,368 2,297 2,422 2,494 2,606 7,522 Electricity (Eskom & Municipal) 6,427 7,294 8,981 13,233 18,018 18,719 21,310 58,047 Housing (National, Provincial & Municipal) 5,828 5,206 5,185 8,398 9,594 11,075 11,746 32,415 Education infrastructure (Provincial) 1,046 1,610 2,277 2,481 3,022 3,351 3,894 10,267 Health (Provincial) 4,501 4,901 5,030 6,381 6,744 7,425 8,087 22,255 Roads (SANRAL, Provincial & Municipal) 9,079 11,175 10,810 13,851 16,310 22,079 24,791 63,180 Rail (SARCC & Spoornet) 1,891 2,245 2,147 4,465 5,090 6,321 6,380 17,791 Ports (NPA & SAPO) 1,659 1,589 2,221 2,843 5,244 5,172 4,268 14,684 Courts 271 244 245 253 980 851 831 2,662 Police infrastructure 257 314 368 447 498 708 1,188 2,394 Prisons 164 204 100 235 398 451 570 1,419 Total 36,871 41,385 43,263 60,923 75,742 84,822 91,377 251,941

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Breakdown of Road Sector Expenditure Estimates

Roads infrastructure expenditure estimates

Sector

2002/03 2003/04 2004/05 2005/06 2006/07 2007/08 2008/09 Total MTEF

National Roads 1,846 2,374 1,657 2,399 3,894 7,943 10,083 21,920

Provincial Roads 5,333 5,878 6,353 7,265 8,012 9,520 9,885 27,417

Municipal Roads 1,900 2,923 2,800 4,187 4,404 4,616 4,823 13,843

Total Roads 9,079 11,175 10,810 13,851 16,310 22,079 24,791 63,180

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Gross Fixed Capital Formation – Public Sector (Reserve Bank)

Gross Fixed Capital Formation (Current prices)

0

5,000

10,000

15,000

20,000

25,000

30,000

35,000

40,000

45,000

1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004

Years

General Govt Public Enterprises

21

Gross Fixed Capital Formation – Public and Private Sector (% GDP) (Reserve Bank)

Gross Fixed Capital Formation (% GDP)

0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

12.0%

14.0%

16.0%

18.0%

20.0%

1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004

Years

Perc

entag

e

Govt Public Enterprises Private Enterprises GFCF

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Broad indicators of successA broad measure of success in the general direction, is that government (across departments and spheres):

• Is now prioritising infrastructure and capital investment• Beginning to re-build capacity after shedding many built environment

professionals over the years• Starting to plan earlier and more effectively in many cases

Indicators that lead us to conclude that we are moving forward in the right direction are:

• increases in gross fixed capital formation trend in the government and public sector as a whole, and more importantly, private sector GFCF.

• increases in government capital expenditure and number of projects appearing on our project registers

• improved confidence and outlook assessments in construction industry reviews• increased demand for engineers and other built environment professionals • More PPP’s and mega-projects identified and pursued• Overall upward trend in GDP

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Issues needing attention The planning, generation and management of projects• Since democracy much skills have been shed - these need to be renewed through

targeted efforts ensuring transformation• Restructuring resulted not only in skill loss, but loss of systems, process and

organizational knowledge resulting in confusion at planning and delivery level Too many projects of all sizes are not managed and monitored by suitably qualified people.

• project appraisals and approval pathways even on large projects needs attention. • Re-engineering the business processes of project planning, approval and

management

The construction/delivery environment• - constraints and shortcomings both in workmanship and material shortages.• - some contractors taking on bigger jobs they can handle and abandoning jobs

resulting in expensive project delays, at the same time we need to nurture small contractors to get bigger, better and more in number in order to prepare for greater infrastructure expenditure in future

• - material shortages and the booming tender environment in many cases result in higher tender prices, rendering original estimates and budgets too low.

• - rationalisation of contract docs and specs so as not to burden small contactors• -profiteering

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Issues needing attention (cont)Quality, standards, and maintenance

- With increasing work in the industry, coupled with skills/learning curve constraints, and lower monitoring/quality control capability from authorities, the quality of construction is in many sectors in decline.

- same applies in the planning and development approvals/town planning environment in especially the smaller muni’s, where development proceeds regardless of whether the existing infrastructure has the capacity to cater for additional loads

• - far more thinking should be done by the built environment research and development community on better though cheaper /quicker housing and other infrastructure

• - much attention needs to given to the prioritisation of maintenance of assets, especially systems that schedule planned maintenance and the budgeting for this.

Coordination, cooperation and collaboration-Misaligned, unbridled and uncoordinated investment in infrastructure results in weakened benefits relative to costs, diminished multiplier effects on growth, and reduced returns on investment. There is therefore a need to:

• Target investments towards needs and areas of higher growth potential• Coordinate efforts of different agencies/authorities and their respective infrastructure

types towards these targeted developments and large multidisciplinary projects• Cooperation between approval authorities in different spheres to remove red-tape

approval bottlenecks is essential to accelerating delivery on investments• Collaboration between the planning sections of departments and even the private

sector in order to create sustainable living spaces and a viable built environment.• The plethora of high level plans need to be aggregated, and assimilated at national

level and inform and align consolidated national planning.

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Thanks!

Questions?